MRS. CLINTON: Thank you very much. And I want to thank
Secretary Shalala, who has been a strong voice and strong force on
behalf of issues that affect how we live and what kind of country we
are.

I want to thank all of you for being here, as we come together
to talk about one of most important challenges our nation faces today --
saving and preserving Medicare. I want to acknowledge the many people
here who have done so much over the years to help us meet our
obligations to each other and to the next generation -- members of the
Older Women's League, the American Association of University Women, and
those of you who represent women's and seniors' groups and Medicare
advocates from one end of our country to the other.

We've come here today because our nation is engaged in a
critical debate about America's future. We're living in a time of great
prosperity and blessings, and of almost unparalleled opportunities for
progress for all of our citizens. And we should all take pride in what
we have been able to accomplish together over the last six and a half
years. But the question before us now is how do we take advantage of
this historic opportunity to take on some of the tough challenges our
nation faces? How do we strengthen, rather than weaken, our fundamental
commitments not only to our parents and our grandparents, but to future
generations as well?

And that brings me to an issue that touches all of us, the
urgent need to protect and preserve Medicare. Unless we act now,
current projections say the Medicare trust fund will be insolvent in the
year 2015, which is not very long at all. While this is a major concern
for all of us, we're here today to spotlight those who have the greatest
stake in a strong and healthy Medicare program, and that is America's
women.

As the Henry Kaiser Family Foundation and OWL have reminded us
again and again, women simply live longer than men. Now, we hope that
is one gender gap that will eventually be closed, but it is the fact.
And it is the fact as we project out into the 21st century. Now, that
means we have more years to cherish our mothers and our grandmothers,
but it also means that they and we are more likely to suffer from
multiple and chronic illnesses and have greater long-term care needs.
Four out of five of America's elderly women are widowed and almost half
live out their days alone. And, not surprisingly, elderly women are
much more likely to be poor. Nearly 7 in 10 Medicare beneficiaries
living in poverty are women.

For all these reasons, supported by new data that the
President will talk about in a few minutes, women rely more on Medicare
than men and are, therefore, more vulnerable to changes in Medicare
policies.

Over the past six and a half years, and as recently as a few
weeks ago, I've spoken with women around the country about their
concerns about the future: Women living alone who worry about who's
going to care for them when they can no longer live independently; women
with limited incomes who are struggling to pay for their prescription
drugs, who don't think they can afford to get regular check-ups or get
screening tests for osteoporosis, or breast cancer; women who, in their
60s and their 70s, are taking care of their aging or disabled parents,
and who rely on Medicare to help them meet their family
responsibilities.

I'm sure each of us here today has a story to tell. And we
have with us just one example of a devoted daughter: Mary Lee
DiSpirito, whose mother came to live with her in Virginia after her
father died. As her mother became increasingly frail, Mary Lee had to
stop working to care for her mother full-time. Like so many elderly
women today, Mary Lee's mother suffered from multiple health problems.
And while she had Medicare, and even a Medigap policy, it did not cover
prescription drugs.

Because her mother's sole source of income was a monthly $800
Social Security check, Mary Lee and her family paid $4,500 a year in
out-of-pocket expenses for prescription drugs -- an amount that would
have -- if her mother had been alone, without a devoted daughter and
family -- would have depleted half of her mother's yearly income. Mary
Lee's mother passed away last November. But her valiant efforts to care
for her mother, often under very difficult circumstances, are a vivid
reminder of why we must act now to protect and preserve Medicare. I'd
like to ask Mary Lee to stand up, because she is emblematic, and
symbolic, of women throughout our country. (Applause.)

We owe Mary Lee and all of us the commitment that goes not
only to our parents and our grandparents, but to those of us in this
generation who are the caretakers who will soon begin to age, may become
disabled or chronically ill ourselves. And we owe it to our children
and eventually our children's children -- because if we don't invest in
our nation's priorities and dedicate the necessary funds to save and
modernize Medicare, countless women, like Mary Lee and all of us, and
her mother and ours, will be at even greater risk than they are today.

If we don't save and modernize Medicare, then women will
continue to struggle to pay for out-patient prescription drugs, and the
problem will only get worse as medical advances increasingly rely on
drug treatments that even today are beyond the means of most ordinary
citizens. If we don't save and modernize Medicare, then women will
continue to skip regular screenings and check-ups that would enhance the
quality of their lives and reduce Medicare's long-term costs.

And perhaps most importantly, if we don't take advantage of
this time of prosperity that we have worked so hard to achieve, then we
will look back at our generation as having missed a unique opportunity
to make responsible decisions and we will instead have run the risk of
becoming a great burden to our own children that none of us ever wanted
to be.

That's why I believe that to meet these critical challenges we
must take a responsible and balanced approach to tax cuts. Only then
will we be able to meet our obligations to America's elderly and
disabled, and extend the life of the trust fund for the next quarter
century. Only then will we be able to modernize the benefit package to
include prescription drugs and preventive care, and support the teaching
hospitals that are so critical to serving America's poor and elderly.
And only then will we be able to sustain and expand the investments we
are making now in our schools, in our environment, in our cities and our
country that are so critical to our future prosperity.

So, as we continue to debate these critical issues, not only
in the halls of Congress, but around our kitchen tables -- let's not
forget the human dimension of what we stand for and we fight for, and
what we are seeking to protect and support. Sometimes these debates
have a way of making our eyes glaze over as hundreds of billions of
dollars are talked about. So let's remember to keep a human face on
this debate. (Applause.)

And I want to introduce someone who will add to our
understanding and make sure we keep that human dimension, just as Mary
Lee has, someone who knows firsthand the challenges of caring for an
aging mother at a time when her own daughter had not even yet left home.
She knows what's at stake for women in this debate over the future of
Medicare. She also represents millions of women who would benefit if we
act now to strengthen and modernize Medicare. So it is my great
pleasure to introduce Judith Cato. (Applause.)

THE PRESIDENT: Well, I must say that Judith did such a good
job, there's hardly anything left to say. (Laughter.) Thank you very
much for being here, and we welcome your daughter here.

I want to thank Secretary Shalala, and acknowledge the
presence in the audience of Deborah Briceland Betts, the Executive
Director of the Older Women's League; the people here from the Henry
Kaiser Family Foundation, and the other representatives of women's
groups, senior women's groups, and Medicare advocates. Hillary and
Secretary Shalala and I are delighted to welcome you to the White House
today, and we thank you for your interest in this critical issue.

We are here to discuss what I have repeatedly called a
high-class problem: the American people are living longer, especially
women. And it is a high-class problem because we have this surplus
today, and a projected surplus for several years into the future, which
will enable us to deal with the challenge of people living longer and
spending more money on Medicare, and then the retirement of the baby
boomers, which will put additional pressure on Medicare and on Social
Security.

It is a high-class problem, but we don't want it to turn into
a nightmare because we walked away from it when we could have dealt with
it and we had the money to deal with it -- when we had the time to deal
with it, and we knew good and well we ought to deal with it. So, again
I say I thank you for being here, and I hope today we can get out some
information which will persuade the American people and members of the
Congress that the approach I have recommended for the future is the
right one.

For 34 years now, Medicare has protected the health of our
seniors -- it has enriched the lives of the disabled, it has eased the
financial burdens on families as they cared for their loved ones. For
millions of American women, in particular, Medicare has been the
lifeline to a dignified retirement.

As the report released today by the Older Women's League so
clearly tells us, a strong and modern Medicare system is absolutely
vital to the health and future of America's women. First it is critical
because the majority of beneficiaries quite simply are women. Listen to
this: 20 of the 34 million Americans currently enrolled in Medicare are
women. I think we've got a chart that says that. But look here: 41
million -- 41 percent of the people in this country on Medicare over 65
are men; 59 percent are women.

And, of course, as time goes one, the percentages get better
or worse, depending on the perspective. (Laughter.) Twenty-nine
percent of the people over 85 are men, 71 percent are women; 17 percent
of people over 100 are men, 83 percent are women. You may think those
numbers are insubstantial, but Americans over 80 are the fastest growing
population group in the United States, and I'm sure that most of us hope
to be among them some day. So this is very important.

Second, without Medicare the doors to hospitals and doctor's
offices to basic medical treatment and good health would actually be
closed to millions of older women. Throughout their lives, women's
incomes have always lagged behind those of men, a gap underscored in
retirement through smaller pensions and Social Security checks. So even
as they must make ends meet on smaller incomes, women must meet greater
health care needs. Nearly three-fourths of older women have two or more
chronic illnesses, compared to just 65 percent of older men. For these
women, Medicare has truly meant the difference between a healthy
retirement and one clouded by uncertainty, untreated illness and
poverty.

Now, as you have just heard, the clock is ticking on
Medicare's ability to meet the needs of our seniors in the next century.
People living longer than ever, the retirement of the baby boom
approaching, the Medicare trust fund will become insolvent by 2015.
Now, you may think that's a good ways away, but let me tell you, when I
took office, Medicare was supposed to become insolvent this year. And
we took a lot of very strong steps to stop it from happening.

But we have taken all the easy steps, and some that, arguably,
have gone too far. Everywhere I go, people say, you know, the therapy
services have been cut back too much, or the inner-city hospitals with
big teaching loads or the teaching hospitals generally -- not just in
the big urban centers -- everywhere I go, people talk to me about this.
So it should be obvious to everyone, there are no longer any easy ways
to lengthen the life of the Medicare trust fund -- just as people are
living longer and accessing it more. So that is problem one.

Problem two is that Medicare's benefits have not changed
significantly since 1965, although the world of modern medicine has
changed dramatically. There are some who really believe we can afford
to put off this until later. I disagree. To them I say, listen to
Judith Cato's story. Like millions of women in the same situation,
affording prescription drugs for herself is right around the corner, and
for her mother is today.

The typical 65-year-old woman retiring this year can expect to
live to be 84. That's 19 more years of retirement. But if we don't act
soon, the Medicare trust fund will expire in 16 years. Over the past
six and a half years, we have managed to transform an economy burden by
an unconscionable deficit of $290 billion to an economy that today is
the picture of fiscal health, with a surplus of $99 billion and a large
projected surplus over the net decade. We've done this by balancing the
budget, cutting unnecessary spending, expanding our investments in
education and training, expanding our trade abroad; all of it bringing
interest rates down and getting investment up and giving us a remarkable
period of economic growth -- the longest peacetime expansion in our
history; nearly 19 million new jobs and the lowest minority unemployment
and the highest home ownership ever recorded.

The question is, what are we doing to do with this? We know
what one plan is -- you have talked about it. The majority in Congress
say, well, let's approve a big tax cut now and worry about Medicare and
extending the life of the Social Security trust fund, scheduled to run
out of money in a little more than 30 years -- let's worry about that
later.

One of my bright staff members said, it's kind of like a
family sitting around the kitchen table saying, you know, we have always
wanted to plan a really fancy vacation to Europe -- let's just do it and
blow the works, and when we get home, we'll figure out whether we can
pay the mortgage, the car payment and send the kids to college.
(Laughter.)

You're laughing, but you know, it's not just a question of the
size of the tax cut. Why are we even discussing it before we decide
what it takes to save and strengthen Medicare, and what it takes to save
Social Security, and what we have to invest in the education of our
children, the defense of our nation, the protection of our environment.
Why don't we ask ourselves what it is we have to do before we ask
ourselves what it is we would like to do?

Now, so what do I think we have to do? Here's what I think we
should do. I think, first of all, my plan would secure Medicare by
dedicating over $320 billion of our budget surplus for 10 years, to
extend the life of the trust fund from 2015 to 2027. That would be the
longest projected life we've had on the trust fund in many years. But
we have not been this financially healthy in many years, nor have we
faced the challenge of so many people retiring and living so long ever
before. So we need to know it's going to be all right for a good while.

Secondly, we will introduce more modern mechanisms of
competition to improve quality, but to control costs as well as we can,
as private sector innovations have done. We will give seniors the
chance to choose between lower-cost Medicare managed-care plans and the
traditional program, but we will not support changes that would force
them to move from one to the other.

I also believe it's important to modernize benefits and, over
the long run, the economical thing to do. Over the last 30 years, a
medical revolution has transformed health care, and in many cases
prescription drugs now supplant what used to be routinely dealt with
with surgeries. They have lengthened and improved the quality of life.

As the Older Women's League study shows, women have borne the
greatest cost of this pharmaceutical revolution. According to the next
chart, women spend $1,200 a year on prescription drugs, on average --
about 20 percent more than men. Now, as you have already heard, our
plan will help seniors to afford the prescription drugs that have become
essential to modern medicine. The plan is completely voluntary, but
available to all Medicare beneficiaries.

This is a challenge, I might add, not just for poor women. It
is also a challenge for middle-class women as well. Look at the next
chart. Half of all middle-class women -- that is, for seniors, those
who make at least $12,700 a year or, with couples, $17,000 a year --
have no prescription drug coverage at all. So among those who have no
coverage, a quarter are below the poverty line, a quarter are between
100 and 150 percent of poverty, half are over 150 percent of the poverty
line -- although, if your drug bills are big enough, it doesn't take
long to get down below the poverty line again.

Women who have tried to buy extra coverage through private
Medigap policies have to cope with escalating premiums as they get
older. That's one of the great ironies of these Medigap policies that
-- I keep hearing about, you know, we don't really need this because of
Medigap. They get more and more and more expensive as you get older and
older and older and less and less and less able to come up with the
money to pay for them.

Now, I think anybody that says we don't need to do this is out
of touch with people's real lives and out of date. I'd also like to
point out that our plan would eliminate the last barrier between seniors
and preventive screenings -- tests for breast cancer, colon cancer,
prostate cancer, diabetes and osteoporosis -- that can help save their
lives. For too many seniors on fixes incomes, especially low-income
women, the cost of the modest co-payment is prohibitive. Last year, for
example -- listen to this -- just one in seven women took advantage of
the mammograms covered by Medicare.

So what we want to do is to eliminate the deductible and the
co-payments for the preventive screenings -- (applause) -- and we pay
for it by introducing a modest co-pay on lab tests that are frequently
overused, ones that have been identified, and by indexing to inflation
the modest Part B premium, which will be much less burdensome because
it's more broadly spread in a smaller amount of money. But the people
who need these preventive screenings, this will save lives.

Consider the irony of this. Every condition I just outlined,
we pay for the doctor benefits, we pay for the hospital benefits, but we
don't want to let people get the preventive screenings that will keep
them from spending that money in the first place -- keep them healthy
and keep them alive. This is a good thing to do.

Now, this is a good plan. It is a responsible plan. And it
is important that we deal with the Medicare challenge now, while we have
the funds and the prosperity to do so. I have proposed to dedicate the
Social Security portion of the surplus to Social Security, but also to
lengthen the life of the trust fund by taking the interest savings we'll
have, because this will allow us to pay the debt down, and putting it
into the Social Security trust fund, so it will last longer. So we'll
have at least over 50 years of life on the Social Security trust fund.
(Applause.)

And as I said, I proposed to put over $320 million in
Medicare. There's not a single expert on this program who believes that
we can stabilize the fund and lengthen the life of it and deal with the
coming demographic challenges without more money. No one who has looked
into this believes it. And I think this is very, very important,
because if the tax cut being pushed by the congressional majority, which
includes vast benefits for people in my income group and higher -- who
have done quite well in the stock market, thank you very much --
(laughter) -- and are not clamoring for it, and are worried that it will
destabilize the economy -- even today, there are stories in the paper
that if we have a big tax cut, with the economy growing as fast as it
is, it might stimulate inflation, which would cause increases in
interest rates, which would take away all the economic benefits of the
tax cuts in higher interest rates.

So I say to you, I do not believe that is the wise thing to
do. I think first we should say, let's save Social Security and
Medicare; let's add this responsible prescription drug benefit; let's
decide the commitments that we ought to make -- to give our children
good education, to keep our streets safe, to biomedical research, to
national defense, to the environment -- and then let's decide what we
can afford in a tax cut. Let's do first things first.

In addition, another benefit of my plan not present in any
other one is that if my proposal were to pass the Congress, in about 15
years we would actually be out of debt as a nation, for the first time
since 1835. (Applause.)

Now, the significance of that for older Americans is quite
important. Why? Because if we are out of debt, it means we will have
long-term prosperity, lower interest rates -- which means lower costs
for business borrowing, more investment, more jobs, higher incomes, and
for families, lower home mortgages, car payments, credit card payments
and college loan payments. That amounts to a very big tax cut over 10
or 15 years, getting this country out of debt, making us less vulnerable
to the vagaries of the international financial system, securing the
long-term economic stability for the young people here in the audience
and throughout our country.

Believe it or not, we can do all that and still have a fairly
sizable tax cut. I propose to let people use it for retirement savings,
for long-term care, for child care. But the point I want to make today
is not so much what we spend it on, but how much it can be, and in what
order we are doing this. We did not get to this moment of prosperity by
figuring out how to eat our cake, and then looking around for the
vegetables. (Laughter.) That's not how we got here. We got here --
and a lot of members of Congress lost their jobs over it because we took
the tough decisions in 1993 to get the deficit down, to bring interest
rates down, and to do it without having to give up on obligations to
education and to our other important national priorities.

So here we are with this opportunity of a lifetime to deal
with this, and I think we ought to do it. Now, I regret that, as all
of you know, the congressional majority appears to have a different
philosophy. Look what happened -- last week, in the House of
Representatives, they passed an irresponsible tax bill that would spend
our surplus, it wouldn't devote a dime -- not a dime -- not one dime to
extending the solvency of Medicare. And interestingly enough, these tax
cuts are worded so that they won't go into full effect until the year
2010, just when the baby boomers start to retire. And in the second 10
years, they'll cost way over twice as much as they did in the first 10
years.

Now -- so the whole impact of them will hit us right between
the eyes as the baby boomers retire, Medicare nears insolvency, Social
Security starts to show strains.

This week, the Senate is going to take up a similar bill.
They also, I might say, as all the analysis -- I don't know if you've
had -- I don't want to take time today to do this, but if you haven't
seen the analysis of the bills, you ought to, because they're standing
up there saying if we don't give this money back to you -- "they" --
i.e., me and my allies in Congress -- will spend it on "their" friends.

Well, Judith is my friend. (Laughter and applause.) It
sounds so great: "we want to give it back to you, they're going to
spend it on their friends." We want to spend it on saving Social
Security and Medicare, educating our children, paying down the national
debt and getting us out of debt, to help our friends, the American
people.

They tickle me, you know, these guys. They were fighting the
patients' bill of rights several days ago and they said, oh, these
Democrats, all they do is stand up and tell stories, we're talking about
something besides stories. Well, I don't know about you, but the older
I get the more it seems to me like life is just a collection of stories.
(Laughter.) And people are pretty important -- a lot more important
than statistics.

And I'm telling you, I've been at this business a long time.
This country may never have an opportunity like this. And they're
spending it on their friends. (Laughter and applause.) And,
ironically, their friends are better off under our plan because the
stock market has more than tripled -- their friends have done very well
under our plan. We have had an economic policy that has been
non-discriminatory, benefitting Republicans and Democrats, alike.
(Laughter.)

Look, today I want you to read the papers today. They point
out that the Congress, the majority, has begun resorting now to
accounting gimmicks, because they've approved such a big tax cut they
can't meet the fundamental obligations of government without beginning,
right now, to spend the surplus. And they don't want to acknowledge
that, so they've resorted to accounting gimmicks to disguise the fact
that they're dipping into the surplus. They can't live within the
budget limits we set in 1997 -- I told you, we all know we cut Medicare
too much in '97; we're going to have to fix it. A lot of you know it.
A lot of you deal with these programs and these health care providers.

But they want to give the illusion they're living within the
budget limits, nothing has to be done, and they can have this tax cut.
I'm telling you what's going to happen. If this tax cut were to become
law, it would mean huge cuts in education, huge cuts in the environment,
huge cuts in medical research, huge cuts in health care, and huge cuts
in national defense -- or, if they didn't do that, we would see --
balloon the deficit again, just like we did in the 12 years before I
took office, when the national debt quadrupled.

We tried it that way; it didn't work very well. Why are we
going down the same road we tried before, when we have a road that we
have tried for six and a half years that has brought us to this point?
Why would we reverse course instead of building on what we've done and
going beyond it? It is a big mistake, and it's wrong. It's not just
wrong for the seniors. It's not just wrong for the women of this
country. It's wrong for all Americans. It is not the right thing to
do.

Now, it also -- it will take away the single best opportunity
any of us will ever have in our lifetimes to save Social Security for
the baby boomers, to save and strengthen Medicare, and to get us out of
debt for the first time since 1835 -- to give the young people in this
room a chance at a generation of prosperity. And I don't believe any
thinking person, once they understand what the real numbers are -- let's
get out of the rhetoric here, who's going to give it to whose friends
and all that. What are the numbers? This is an arithmetic problem.

You know, I told people when I got elected President -- I'd
come from a state with fairly straightforward values and ways of doing
things, and I thought we ought to have a radical new idea in Washington
-- we'd bring basic arithmetic back to the budget. (Laughter.) And
basic arithmetic has worked pretty well. This doesn't add up.

And so I ask you to help me send the word to the Congress that
let's do first things first. Let's fix Medicare. The women of America
especially need it. (Applause.)

You know, we have to work together. Every time we get in one
of these fights people throw their hands up. But there's normally a
process that goes on here. When we were doing welfare reform I vetoed
two bills because it took away the mandate of health care and nutrition
for children. We finally got a welfare reform that I thought was right,
it carried by big majorities in both parties, in both Houses -- we have
the lowest welfare rolls in 30 years. And we did it in an election
year.

Then the next year we did the Balanced Budget Act and it has
worked superbly. The only problem with it is that the Medicare cuts
were too burdensome on certain groups, and we're trying to fix that.
But I can tell you that if this tax cut passes there will be
breathtaking cuts in every area of our national life that you would
believe is important, over and above what it would do to totally rob us
of any chance to stabilize and improve Medicare and save it for the baby
boom generation.

We have big tests as a country: How are we going to deal with
the aging of America? How are we going to give all of our kids a
world-class education, especially since more and more of them come from
families whose first language is not English? Those of us who expect to
be alive in 20 years, or hope to be, better hope we do a good job of
educating those kids.

How are we going to deal with all these other challenges? How
are we going to bring economic opportunity to people who still haven't
felt it? How are we going to stabilize the economy so that we'll still
be growing even better 10, 15, 20 years from now? These are big
challenges. But they are high-class problems in the sense that nations
rarely get these opportunities. Once in a lifetime you get a chance to
stand up with your country in good shape, bring people together, look
down the road and say, yes, these are big challenges and we're going to
check them off -- one, two, three, four -- because we have the money and
the vision to deal with them.

So my appeal today is that we not get into a big fight, we
just go back to basic arithmetic. These tax bills the majority is
pushing could not get the support of their own members if we had a chart
up on the wall that says, here is what we have to spend just to stay
where we are today in education, defense, the environment, medical
research; here's what every expert says it takes to stabilize Medicare;
here is the interest savings you ought to be putting into the Social
Security trust fund; here is what we have to do to fix health care.
They agree we have to do some more for veterans care. They agree with
these things -- the numbers don't add up. We cannot take the vacation
without paying the home mortgage, the car payment, and the college loan
bill. We can't do it. We can't eat the cake until the vegetables and
the soup are out of the way. And we cannot defy the basic laws of
arithmetic.

And contrary to some of the debate, we cannot forget the
stories. This is about how millions upon millions upon millions of
Americans will live. Will they live in dignity and health, or will they
live in want and insecurity, imposing unconscionable burdens on their
children, and limiting their children's ability to raise their
grandchildren?

Or will we use this moment to build a more prosperous, more
just, more decent society? This is about way more than drugs and trips
to the doctor. This is about what kind of people we are and whether we
can look beyond today to the tomorrow we all want for all of us.